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Government to invest €450 million into education system

According to the budget strategy approved by the Estonian government on Wednesday, the country's education system is to get a boost of more than €450 million over the next four years, much of which will be spent on teacher salaries.

It was decided in the budget strategy that more than €246 million will be spent on raising teachers' salaries over the next four years, a press officer from the Ministry of Education and Research told BNS on Thursday.

A total of €61 million will be contributed to the program to motivate increasing kindergarten teachers' salaries, including €2.5 million to be paid this fall already.

"The goal is to raise the salaries of kindergarten teachers so that it would be on the same level with school teachers' salaries," explained the press officer. "In the majority of local governments, this will result in the average salaries of kindergarten teachers increasing by around 50 percent."

The government also decided to support research and development activites with €22 million, increasing post-graduate students' support with €20 million, increasing school lunch support with €24 million, remote rural high schools situated far from population centers with €2 million, implementing the pilot program for teaching Estonian in high schools with €4 million and continuing to establish state high schools with €4.8 million over the next four years.

Rail Baltic to cost €5.8 billion

The latest estimates put the cost of the international railway project Rail Baltic, including the construction of the Kaunas-Vilnius section, at €5.8 billion, of which Estonia's share is €1.3 billion.

"In the case of such megaprojects, it is essential to keep track of the prices of different components, such as construction work and materials, bridges and viaducts, ecoducts and environmental alleviation measures, which may change over time," Rail Baltic Estonia CEO Indrek Orav told BNS.

"While AECOM's 2011 analysis calculated that the railway would cost approximately €3.8 billion to build, figures concerning the aforementioned components as well as the exact route and technical solution are known by now, and therefore the cost can be calculated considerably more precisely than back in 2011," he explained.

"Compared to 2011, the overall cost of the project has increased and totals approximately €5 billion," said Orav. "Adding the construction of the Kaunas-Vilnius connection, we get a cost of around €5.8 billion. The cost of the Estonian section has remained stable in recent years at about €1.3 billion, of which the Estonian state's co-financing would account for €250-300 million."

At a press conference last October, project coordinator RB Rail CEO Baiba Rubesa said that the total cost of Rail Baltic may amount to €5 billion. As recently as last May, however, the overall cost of the project was estimated to be €3.68 billion.

Rail Baltic is the project for the construction of a European-gauge high-speed railroad from Tallinn to Lithuania's border with Poland.

Finnish Metsä Wood buys property for plywood factory in Pärnu

On March 10, Metsä Wood Eesti AS purchased from Trigon Property Development a 104,000 square meter plot of land in Pärnu where it will build a €50 million plywood factory that will create 200 new jobs.

Trigon Property Development announced on Friday that it had sold the property at 17 Kase Street for €850,000.

In June 2016, Finnish forestry industry group Metsä Wood announced the launch of a €100 million investment program in Finland and Estonia which included €50 million euros to build a plywood mill in Estonia.

The program, which is to be implemented in steps, will increase the group's annual birch plywood production by about 30,000 cubic meters and the output of Kerto laminated veneer lumber by 20,000 cubic meters by the end of 2018.

Telecommunications company Elisa has entered into an agreement with Santa Monica Networks Group (SMN), a company specializing in secure IT networks and data center solutions, to acquire SMN’s companies in Finland and Estonia.

SMN is selling its businesses in Latvia and Lithuania as well, though they will be acquired by private equity firm Livonia Partners together their with management.

Elisa will pay €28 million for SMN’s Finnish and Estonian businesses. The completion of the transaction is subject to certain conditions, including approvals by the competition authorities of Finland and Estonia. The transaction is expected to be completed by May 1, 2017.

According to Elisa, the transaction has no impact on the company’s financial strategy for this year, and meets Elisa’s strategy to strengthen its position in the Finnish and Estonian markets.

With this transaction we strengthen our corporate customers segment in the design, construction, and secure customer-oriented maintenance network solutions. The increasingly digital environments of our customers require continuously faster reactions to different situations. We will significantly increase this capability with Santa Monica Network’s solutions and expertise,” vice-president at Elisa, Jorma Niemela, said.

Managing director of SMN, Kai Vuokko, said that by combining the top expertise of the companies, they could offer superior expertise, and together would be able to provide customers with new services and even broader solutions in the area of secure corporate networks.

The revenue of the acquired companies reached approximately €44 million, EBIT approximately €3 million in 2016. Santa Monica Networks employs 73 people in Finland, and 36 in Estonia.

Elisa to set up 100 new base stations in Harju County

Elisa is also starting an extensive program this week to expand its 4G network in Harju County, as part of which it will set up one hundred new base stations around Tallinn over the next month at a cost of more than a million euros.

“Four weeks from now, 90-95 percent of the Elisa 4G network will be covered with a second frequency layer that will enable us to offer customers up to three times higher Internet speeds,” Elisa Estonia board member Toomas Poll said in a press release.

Poll added that the aim of Elisa was to introduce 5G Internet to the Estonian market, and that they were moving towards that goal by setting up different frequency levels.

The second frequency layer will be distributed evenly across the whole region based on actual customer activity. This means that the density of the 4G network is increased wherever necessary. Where Elisa’s existing 4G network uses a frequency of 800 megahertz, the new layer will predominantly use 1,800 megahertz, whereas the third layer will have a frequency of 2,600 megahertz.